Mitsubishi will acquire its eighth dealership this year as it heads towards a 12-strong network over the next three years.

The Colt Mid West (CMW) business, with sites in Cheltenham, Cirencester, Bristol, Reading and Putney, has already this year opened a dealership in Weston-super-mare and purchased a showroom in Dursley. Its eighth, as yet unnamed, site will also be within this M5/M4 geographic region.

It’s a major turnaround for the manufacturer-owned business, which was in danger of being closed down by Jim Tyrell, Mitsubishi UK managing director, when he took control in 2000.

“It was a small retail group with five sites that was performing badly. We considered closing it down because it was losing money.”

The group was saved from closure by Rob Ayland who joined in 2003 from Warners, which has dealerships in Gloucester and Cheltenham. “CMW has gone from a minor irritant to a generator of significant profits for our business,” adds Tyrell.

He has given Ayland the green light to add more dealerships through a process of filling open points and acquiring businesses from Mitsubishi retailers looking to sell up. But he stresses the maximum size of the network is 12 and that the company remains primarily a distributor with an independent retail network – currently 140-strong.

CMW also operates “at an arms length trading agreement” and under the same conditions as other Mitsubishi retailers with no preferential treatment.

“CMW is the biggest Mitsubishi group in the UK and will register around 2,000 new vehicles this year, turning over between £60-70m,” says Tyrell. He says the group will never exceed more than 10% of Mitsubishi’s UK sales, and predicts a 12-outlet network will turnover around £100m.

“The objective is to make profit (return on sales is just over 2% this year). But we also get spin-off benefits,” Tyrell says. “We are closer to what happens at the retail end of the business, which helps when it comes to developing incentives programmes, and we get good feedback about the business. We also use CMW as the disposal route for our own company cars, which has a positive knock on effect for benefit-in-kind for our employees.”

He adds: “It’s nice to be able to rely on a group that will hit its targets – we know there is a core volume of business that we’ll always have.”